With the announcement of standardising e-invoicing by the government in October 2020, many businesses have begun to wonder how will the e-invoicing impact their business and how are they going to implement e-invoicing into their businesses.
Let us first assure you that if you are owning a business that does business under ₹ 500 crores then you do not have to worry just now because the first step of implementing the e-invoicing will be done across businesses that ever turnover over ₹ 500 crores. The plan is to implement this across other businesses as well.
SO, WHAT IS E-INVOICING?
Electronic invoicing is a system wherein B2B sales of businesses will be authenticated by the GSTN of the GST network with the common GST portal being the database. This will help businesses in avoiding all the manual paperwork that is required for GSTR-1 returns as everything will be stored in the invoice registration portal(IRP).
ARE YOU READY FOR E-INVOICING?
Before we find out if your company is ready for e-invoicing we must determine a few things and one of the most important things is, does the e-invoicing mandate apply to your company? If the answer is yes then you must start preparing and if the answer is not right now then you must find out how soon you will need to apply for this. Along with that, you must also find out if there are any changes that you have to make in your enterprise resource planning(ERP) system.
After that, you will have to ask around and find out if your employees are aware of this new change that the government is bringing and how far they have the idea about e-invoicing. You must also understand that if your business is a partnership you should bring down every stakeholder of your business in order to discuss the appropriate steps with them.
Let us now find out how you can meet the challenges with e-invoicing and invoice processing and invoice management, as well as how you can mould your company to the e-invoicing ecosystem and transform your billing system to meet the government compliance.
- COMPANY READINESS – This might not come as a surprise that most of the businesses in India are not familiar with e-invoicing and this is because, in India, businesses have always preferred the manual way of invoicing. This is about to change and no matter how big or how small your business is as you will have to adopt this new way of invoicing so that your GST compliance stays intact. You must therefore discuss this first with your accounts team and train them about e-invoicing because they are going to lead the procedure of e-invoicing in the company. You can also reshuffle your employees and bring in new hands who are going to assist the accountants in handling the e-invoicing. If you are facing any trouble with training your employees about e-invoicing then you can hire an expert who is going to initially support the e-invoicing process in your company. You must make sure that you’re ERP system is updated with the new invoice schema.
- CLIENT AWARENESS – Since we’re all moving forward in the direction of e-invoicing, it is of the utmost importance that you sit down with your clients and inform them about the transition that your company is going through. Even if you are trying to incorporate e-invoicing now or maybe later when the time for your business comes but you must always be open and transparent about every decision to your clients. Inform them about your plans of incorporating e-invoicing and how this is going to change and how this is going to benefit the clients. If done correctly then the new e-invoicing system will be quite beneficial to everyone including the clients as they will not have to file GST manually and everything will be done within the existing system. But for this system to work everyone should be on board including you as a company and your vendors and suppliers as well as the most important element of your company which is your clients.
- UPDATING THE ERP SYSTEM – Your company’s ERP system is the most important piece of software that has to keep track of everything from accounting to project management as well as procurement and risk management and also take care of supply chain operations and compliance. If your current ERP system which includes various technology and other systems cannot handle this new change of e-invoicing then you must hire a professional whose main job is to reorient the ERP system so that it is compatible with invoicing and compliant with the GST standards in India. These vendors should be able to create a dynamic system from the existing one and thereby make use of the existing system without making major changes. This will save a lot of time and capital. Salvaging the existing ERP system will mean that you do not have to train new staff or the existing staff for a new ERP system.
- LAUNCHING THE E-INVOICING SYSTEM – Launching anything new is difficult and this is also the case with the e-invoicing system. Before the final launch you must make your employees believe in the e-invoicing system because if somebody doesn’t believe in something then however hard they might try they will always get it wrong. Therefore, you must make them believe and trust the e-invoicing system and make them believe that this is a better system than the current existing manual system. After the launch, you must be a little understanding of your employees as this is the first time they are trying to implement this system and there will obviously be a few unavoidable mistakes. You must have patience while dealing with them and understand their side and help them in implementing this system. There will always come hiccups but together as a team you can accomplish anything and that also includes implementing this system. We think this digital integration of the manual invoicing system will be great and pave a new future for businesses. We are hopeful but we have to look a few months down the line to understand how has the implementation of invoicing been in practice rather than theory.
There was a blog about how you should get your business ready for implementing the e-invoicing system that the government has taken initiative to launch. if you are having trouble with the implementation of this system as well as with payroll and other services then we at DMM Facility Management Pvt Ltd are here for you because we are the fastest growing payroll outsourcing company in India and we have a solid reputation as a reputable and trustworthy facility management company.
